SolarEdge Technologies Inc (SEDG)
Return on total capital
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | -1,157,230 | 82,018 | 166,120 | 193,600 | 168,996 |
| Long-term debt | US$ in thousands | 330,006 | 627,381 | 624,451 | 1,243,070 | 1,146,700 |
| Total stockholders’ equity | US$ in thousands | 658,342 | 2,411,910 | 2,176,370 | 1,310,040 | 1,085,760 |
| Return on total capital | -117.09% | 2.70% | 5.93% | 7.58% | 7.57% |
December 31, 2024 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $-1,157,230K ÷ ($330,006K + $658,342K)
= -117.09%
SolarEdge Technologies Inc's return on total capital has shown a declining trend over the period from December 31, 2020, to December 31, 2024. The company's return on total capital was 7.57% in 2020, which slightly increased to 7.58% in 2021. However, there was a significant drop in 2022 to 5.93%, followed by a further decrease to 2.70% in 2023. The return on total capital sharply deteriorated to -117.09% in 2024, indicating that the company's capital generated negative returns, which is a concerning sign for investors. This negative return on total capital in 2024 suggests that the company may be facing financial challenges or inefficiencies in capital utilization. It is crucial for the company to assess and address the underlying factors contributing to this sharp decline in return on total capital to ensure sustainable growth and profitability.
Peer comparison
Dec 31, 2024